Page 6 - National Poultry Newspaper

AS the International Poultry Council took stock of the global pro- tein outlook at its first semester meeting in New Orleans, Louisiana recently, one economic reality riveted attention: Total world production of pork will decline in 2019, with poultry in position to wrest the crown from pork as the world’s most consumed meat protein.
The massive shift in meat proteins is being driven by African swine fever in pig herds in three continents and 15 coun- tries.
Production losses in 2019 are expected to amount to 14 percent of the world’s pork supply but may continue to move higher.
African swine fever is decimating pork production in Asia, opening the door for poultry to take the lead as the world’s most consumed meat protein.
Rabobank senior pro- tein analyst Christine McCracken said: “Hog losses in China due to ASF will trigger big shocks in global protein markets, and poultry is the meat protein with the most to win.”
ASF outbreaks are rav- aging pork production mostly in the eastern hemisphere, but the big- gest impact is in China where nearly half the world’s pigs are raised.
Herds there are being hit hard by a disease that results in 100 per- cent mortality of infected stock and for which no vaccine exists.
The disease, which has been in Russia and East- ern Europe for several years, was found in Chi- na in August 2018 and is spreading to South-East Asia and Vietnam (the world’s fifth-largest pro- ducer of pork).
A small outbreak in the European Union has threatened exports there.
“China produces 98 percent of its pork, so a forecast 30 percent de- cline in supplies there by year’s end will lead to a decline in total world protein supplies in 2019, meaning prices for all proteins will rise,” Mc- Cracken said.
“The world will be un- able to fill the supply gap in meat proteins.
“Expect imports of all proteins (beef, poultry and seafood) to have lim- ited near-term impact.
“Prices for all proteins will rise.”
ASF losses will leave China 10 percent short of meat proteins, but China may be able to increase domestic production of other proteins including eggs, beef, seafood and poultry.
“Poultry imports might benefit the most,” she said.
Presiding IPC president Jim Sumner of the US said, “African swine fe- ver is decimating China’s leading meat protein in- dustry, and chicken is the logical alternative.”
He pointed to the op- portunities for world poultry producers, not- ing other animal diseases in China like foot and mouth and highly patho- genic influenza may fur- ther complicate the pic- ture for China’s pork and poultry producers.
As IPC members lis- tened, McCracken al- luded to the tantalising and potentially historic opportunity for a lasting gain in market share for poultry.
“Demand destruction for pork is a potential outcome,” she said.
Pork to stabilise by 2021
Economists at the re- cent meeting agreed that poultry consumption will surpass pork consump- tion on a worldwide basis in 2019.
McCracken termed her outlook for a 30 percent decline in production in
China and a 14 percent decline in world produc- tion as “conservative”, saying the declines may be deeper.
“Poultry consumption will indeed surpass that of pork in 2019, and pork will be unlikely to re- coup its leadership posi- tion,” she said.
Further declines in world pork production of around 3 percent in 2020 are in McCracken’s fore- cast as Asia loses more animals and expansion in other regions not in place by then.
“Stabilisation will be- gin in 2021 and a more modest rebound of 1 percent to 2 percent in volumes in 2022-2027,” she said.
“Environmental and slaughter constraints are likely to limit the size and speed of expansion.”
Dr Paul Aho predict- ed pork production will drop 15 percent world- wide in 2019.
“From there pork will increase 5 percent per year for four years and then continue increasing at a more modest 2 per- cent average per year,” Dr Aho said.
“Meanwhile, poultry will increase 3 percent per year for three years (spurred in part by a shortage of pork) before dropping to an average increase of 2 percent per year.
“Poultry will surpass pork in production this year and will never re-
linquish the crown by my reckoning.”
“With China having lost 30 percent of its herd to ASF and with it pro- ducing 50 percent of the global supply, there is no doubt poultry is now king of the meat pro- teins worldwide,” Sum- ner said.
IPC members eyed the emerging opportunities and consumer and trade issues around the globe as they continued to work towards consensus to re- spond proactively on is- sues like food safety and antimicrobial resistance, sustainability and the environment and animal health and welfare.
Canada’s Robin Horel, executive sponsor of the working group on com- munications and market- ing, said IPC is leading the way on consumer and other issues, includ- ing working to produce defined positions, aspi- rations and direction to align the industry glob- ally.
“IPC is leading on these issues by focusing on pre-competitive issues where we can share best practices and where we can have a direct impact through engagement and communication,” he said.
Addressing global bar- riers to trade is another IPC goal.
“The ultimate evidence of our success will be fewer trade barriers and a safer food supply,” Sum- ner said.
Poultry takes the lead in IPC outlook
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Page 6 – National Poultry Newspaper, May 2019
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